[Money-matters] FW: [Money Matters Newsletter] Congress to consider delaying the "automatic" cuts ! Incredible. Update News Flash June 26, 2012

Tue Jun 26 19:06:44 UTC 2012

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Subject: [Money Matters Newsletter] Congress to consider delaying the
"automatic" cuts ! Incredible. Update News Flash June 26, 2012

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Congress to consider delaying the "automatic" cuts ! Incredible. Update News
Flash June 26, 2012

Marc's Notes:

How do I know our government will never solve the deficit issue? Remember
the Super Committee that had to reach an agreement on 2 trillion in cuts
over 10 years by Thanksgiving 2010? They couldn't agree and disbanded. That,
we were told, GUARANTEED automatic spending cuts to take place without
exception on January of 2013.

I've have always said these promises mean nothing. They can change the rules
at anytime.

Case in point. Now read the article just out today:

"Republican and Democratic congressional leaders are weighing whether to
delay automatic federal spending cuts until March 2013, according to a House
aide and industry officials who were briefed on the discussions.  (Marc's
comments: what the heck does "automatic" MEAN anyway!)

The $1.2 trillion in automatic spending cuts over a decade, half of which
would affect the Defense Department, are scheduled to begin in January 2013.
At the same time, lawmakers must decide what to do about income tax cuts and
other tax breaks scheduled to expire at the end of the year.

Leaders in both chambers are discussing whether to propose a catch-all bill
that would delay the automatic cuts, fund the government through March or
later and temporarily extend the George W. Bush-era tax cuts and other tax
laws, said the House aide and industry officials, who asked to speak on
condition of anonymity.

"It is being seriously considered as one of the options and there is no
doubt about that," Steve Bell, the senior director of the Economic Policy
Project at the Bipartisan Policy Center, said in an interview.

The measure would follow a short-term stopgap spending bill to keep the
government operating after the start of the new fiscal year on Oct. 1, the
people said.

Automatic Cuts

The automatic spending cuts are required by the 2011 agreement to raise the
U.S. debt limit. The cuts were designed to require Congress to find other
deficit-reduction proposals to replace them. Lawmakers so far haven't agreed
on such a plan.

The second measure funding the government until March or later would include
the delay of the automatic spending cuts, according to the congressional
aide and industry officials, who said they weren't authorized to describe
the option publicly.

Senator John Cornyn <http://topics.bloomberg.com/john-cornyn/> , the Texas
Republican who leads the National
<http://topics.bloomberg.com/national-republican-senatorial-committee/>
Republican Senatorial Committee, said today he's aware of discussions to put
off so-called fiscal cliff issues until March. He said while he favors
extending tax cuts until March, he would prefer addressing the automatic
spending cuts this year.

"Sometimes Congress acts when there are no alternatives," Cornyn said of the
automatic cuts. "I would be reluctant to leave aside all the incentives to
reach decisions sooner rather than later."

The Republican-led House passed a bill in May to avert defense spending cuts
and plans to vote in July on a measure to extend the expiring tax cuts.
Neither measure will advance in the Democratic-controlled Senate. President
Barack Obama <http://topics.bloomberg.com/barack-obama/>  opposes both
proposals.

'Fiscal Cliff'

"The House has acted to replace the defense sequester, which President
Obama's own administration says would be a disaster for our national
security, with sensible spending cuts," Michael Steel
<http://topics.bloomberg.com/michael-steel/> , a spokesman for House Speaker
John Boehner <http://topics.bloomberg.com/john-boehner/> , said in an
e-mailed statement. "Next month, we will vote to stop the largest tax hike
in history. The bottom line: We're leading on the big issues that make up
the fiscal cliff -- and the Democrats who run Washington are hiding."

A short-term extension of expiring tax rates would cause problems for an
already strained Internal Revenue
<http://topics.bloomberg.com/internal-revenue-service/>  Service, said Mary
Burke Baker, a government affairs adviser at K&L Gates LLP in Washington.

"It complicates the programming IRS has to do," said Baker, a former IRS
employee and congressional aide. "It's increased cost, both for the IRS and
for taxpayers."

Short-term Action

Any short-term action would be more problematic if it also occurs late in
the year. In 2010, when Congress didn't enact tax-cut extensions until
mid-December, the IRS delayed for several weeks the start of the filing
season for taxpayers claiming itemized deductions.

The outcome of the November election will help determine what action
Congress may take to avert the automatic budget and tax changes. The stack
of tax-and-spending issues creates the potential for a deal on fiscal
policy, a partisan standoff or a congressional deal that staves off an
immediate crisis by setting up another one in the future." (end of article).

Marc's Epilogue:

Like I said, they will change the rules anytime. Now the cuts are being
considered postponed to become another political football. Our government is
dysfunctional. They are liars. They will NEVER address serious budget cuts
until they blow this whole thing to hell. Now that they broke the ice on
reneging on their promise (again), watch the spin and the lies and nothing
will be done. No cuts. (None that mean anything anyways).

More promises to "fix it sometime in the future" that will never come. The
economy and the politicians are addicted to debt and will NEVER initiate
cuts or control their spending.  A hell of a lot of good 2 trillion in cuts
over 10 years will do anyway. We are running deficits of that EVERY YEAR if
you count war costs not to mention Medicare or Medical which run it many
times over that.

This is going to end VERY badly. Trust me on this one.
It will be fun watching the lies to come though.

Disgusting.

Marc

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